Redesigning the Industry

A new auto industry is forming, triggered by a reimagining of the vehicle itself. New business models are coalescing, centered on technology innovators, fleet operators, services businesses and platform providers.

For a man with his family's name on every car, Akio Toyoda ironically sees himself as a sort of Jedi knight fighting the corporate Empire. Toyoda channels that Jedi spirit to reinvent Toyota, taking on challenges buffeting the industry in a new era.

Han Hendriks says startup mobility players are not 'handcuffed' by a century of automotive history. Instead, new firms are looking to adopt pay-per-use business models from other industries and rapidly apply them to the auto sector. Hendriks, who serves as chief technology officer for auto interiors supplier Yanfeng, says traditional OEMs must evolve in the eyes of consumers to survive.

Strategies

In the second of our 5-part series, we look at how fast and unrelenting changes in technology have forced automakers to re-examine what they want to be and how they want to get there.

Wait and see. That was Fiat Chrysler Automobiles' approach for years to autonomous technologies and electrified vehicles. But the demands of a rapidly changing industry have forced the automaker to reassess its plans.

Larry Dominique says changing shopping behaviors are the reason French automaker PSA Group's first plan of action as it re-enters the U.S. market is developing a mobility strategy that offers services without its cars. After more than three decades in the business, the GM-Chrysler-Nissan-TrueCar veteran says there are “better margins at times when focusing on some of these service-based businesses than pure manufacturing.”

Suppliers

In the third of our 5-part series, we look at how suppliers are reimagining themselves and regrouping into new partnerships to deliver the vehicles of the future.

The bright future of autonomous vehicles and smart transportation grids is still a bundle of unanswered questions. But one thing is for sure: getting there is triggering a massive industry restructuring.

Longtime Magna boss Don Walker can quickly curb the enthusiasm of someone who believes widespread adoption of electric vehicles and robocars is just a few years away. The head of North America's largest auto supplier says it could take a decade or longer for EVs and AVs to dominate the world's roads. And while Magna is aggressively developing new technologies, Walker warns: 'Nobody will thank you for being a visionary' without a return on investment.

Retail

In the fourth of our 5-part series, we examine how dealerships will survive upheaval of the business model by shifting their focus toward mobility services and away from selling cars.

While there's no certainty in any future prediction, it is pretty clear that today's dealership model -- based primarily on selling one vehicle at a time to individuals and then servicing those cars and trucks -- won't emerge unscathed in a world of shared, autonomous, electrified vehicles.

Don Flow says there’s a “brutal reality” confronting his dealer peers as new developments such as ride-hailing services force the age-old auto retailing model to evolve. The CEO of the 36-franchise Flow Automotive Cos. says dealers will survive and flourish – but they must become digital companies and focus on creating a personalized experience for customers.

Customers and countries will be among the automotive sector's biggest power brokers as the industry races toward an era of electrified vehicles and robocars. That's why automakers and parts suppliers are developing various zero-emission technologies and personalized car interiors while keeping an eye on regulatory changes from the '800-pound gorilla' in the room.